The international real estate advisor also notes that if office space coming to the market over the next nine months is included, this figure rises to 4.8%, an increase of one per cent on the previous quarter. As a result, just over 80,000 sq m of office space is vacant in the CBD.

Since the end of 2015, the open vacancy rate in central Stockholm‘s CBD has fluctuated between 3% and 4%, which has contributed to strong rental growth.

Peter Wiman, Head of Research, Savills Sweden, says: “The low office vacancy levels have led to a lock-in effect on the rental market, where tenants have had limited choice when relocating. As a result rents in the CBD and, to a lesser degree, in other parts of the inner city, have risen sharply. With the supply of vacant premises having increased significantly, tenants are now in a much better position to negotiate.“

At the end of 2019, the amount of office space available to sublet stood at just over 10,000 sq m. Since the beginning of 2020, the volume of sublettings has more than doubled and stands at c. 25,000 sq m.

Peter Wiman adds: “Although sublettings are less attractive from a rental perspective, they are nonetheless competing with the supply in the office market and affect the full vacancy rate. Subletting corresponds to approximately 1.4% of the CBD’s office stock, which means that the total vacancy rate is as high as 6.2%, something we have not seen for years.“

Filip Lindmark, Associate Director, Occupier Services at Savills Sweden, says: “When we analyse the supply of subletting, we can see a clear connection to the tech sector. Many companies in the tech sector have grown very rapidly and, in many cases, outgrown their offices and moved to other premises and chosen to sublet their old offices. However, in the past quarter, we have also observed a significant increase in tech companies that have sublet their new space, which may be due to the current pandemic as an attempt to reduce costs.”